Depends on what you're using as hardware.
If you have a mining machine that is solely used for mining and absolutely nothing else, then you can easily deduct the depreciation of the machine and the electricity the machine uses (a reasonable recalculation should work for cost of electricity). However, if you have a personal computer that you sometimes use to mine, and sometimes use to go online / watch movies / etc., you're not going to be able to deduct anything for this.
The IRS has been making a big push recently targeting business items that have personal use, which is why I'd advise against anyone trying to deduct the cost of their main computer as a bitcoin expense.
NO!Bad advice. You cannot setup a depreciation schedule (I.e., capitalize equipment) because the useful life is less than 1 year. This may vary depending on your outlook, but it am firm that nothing in my rig is intended for use greater than 8 months and the salvage value is also very low due to increasing difficulty. Appreciation in BTC may change this outlook over time, but you are supposed to establish depreciation schedules according to future expectation from historical knowledge, and everything I've seen shows this equipment will operate at a LOSS anything further out than 8 months. This is not a dump truck or an oven, it is an ASIC miner, and anyone mining BTC right now is using one. You cannot capitalize (depreciate) equipment that in intended for short-term (1 year or less) use. For equipment that serves a life of less than 1 year you record a 1-time expense for the cost of the mining gear. Many will do this wrong and overpay, those who do it correctly will show a net loss and have a higher audit risk. Awesome.
People that don't know enough about mining are giving bad advice all over the place. Stop with the depreciation schedule stuff, it's not suitable for mining activity with ASIC chips.